Asda reveals roll out of On the Move convenience stores as sales decline in the second quarter

Big four supermarket Asda has announced plans to expand in the convenience market by launching 28 new Asda On the Move stores this year, up to 200 sites next year and the ambition to roll out further stores in 2023.

Asda has announced plans to expand in the convenience market by launching 28 new Asda On the Move stores this year.

The Leeds-based grocer also revealed that like-for-like sales excluding fuel declined by 0.7 per cent between April 1 and June 30 compared with exceptional sales seen during the first lockdown in the same period last year.

Two-year like for like sales growth excluding fuel remained resilient, up 3.1 per cent as more meals continued to be consumed at home.

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The new owners of Asda, Mohsin Issa CBE and Zuber Issa CBE said the business has “proved incredibly resilient in 2021”.

The brothers added: “Our plans to roll out Asda On the Move will bring Asda to new customers, enabling them to pick up food-to-go, essentials for an evening meal, or treat themselves to premium Extra Special products from a range of convenient locations.

“We continue to see significant opportunities to drive innovation across the business and we look forward to working with the Asda team to execute our growth strategy.”

The launch of the convenience stores follows a trial of five Asda On the Move stores, which have opened on EG Group forecourt sites since last October, as part of the supermarket’s partnerships strategy.

The Asda On the Move rollout will begin next month, with sites opening in Knowsley, Crewe, Skelmersdale and Holtspur. Asda will supply the products on a wholesale agreement to EG Group, which will own and operate each site.

Each site will be up to 3,000 sq ft in size and stock up to 2,500 products, including a selection of Asda’s premium ‘Extra Special’ range and a range of fresh produce and chilled lines.

They will also include food service offerings from EG Group and its partner brands such as Greggs and Subway.

Asda said its move into convenience will substantially broaden the number of new and existing customers who can access the supermarket’s products in convenient neighbourhood and roadside locations.

The stores will open across EG Group’s existing forecourt estate in the UK and are also expected to be situated on some new-to-industry sites as well.

In the trading update, Asda said the lockdown trend of customers trading up and treating themselves to premium products continued during the second quarter, with a 23 per cent increase in like-for-like sales of Asda’s premium Extra Special range compared to 2019.

As lockdown restrictions were relaxed and more customers returned to stores, demand for online groceries gradually eased, compared with the levels seen during the first quarter.

However, online accounted for 17 per cent of total food sales during the quarter compared with 10 per cent in the second quarter of 2019.

John Fallon, chief finance officer of Asda, said: “As customers responded to the gradual easing of social distancing restrictions, we inevitably saw sales soften compared to the exceptional lockdown-driven demand experienced during the first quarter.

“Nevertheless, the continued resilience of our business has been demonstrated in the positive like-for-like sales growth compared with the same period in 2019, as we were able to take advantage of a higher level of in-home consumption, satisfying customers’ needs across both food and non-food. As

“Looking ahead to the rest of the year, the first phase of the rollout of Asda On the Move is an exciting next step for the business, enabling us to supply a new convenience store offer, complementing our other store formats.”

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